Picking Sydney’s property hotspots in 2014

Mar 11, 2014

Sydney is a big city with hundreds of suburbs – close to 650 in fact. So when it comes to investing in property, picking the next ‘boom’ opportunity is no mean feat.

The advice from leading Sydney buyer’s agent and host of Your Property Empire on Sky News Business, Chris Gray, is to forget about picking the next hot spot and instead focus on blue-chip suburbs with good fundamentals that will perform well over the long-term.

“Investment properties in the inner city areas are reasonably robust through most market conditions. You might pay a premium to invest in these areas, but you will have more protection during down times,” says Chris.

Chris advocates a long-term approach to investing in property and suggests taking a 30 year view. “We back the tortoise – slow and steady will win the race. It means that short-term fluctuations are less important. You also don’t have to be an expert at picking the next big boom trend, which can be extremely difficult to do.”

Chris suggests that suburbs such as Bondi to Maroubra in the east, Neutral Bay, Kiribilli and Cremorne in the north and Balmain, Leichardt and Annandale in the inner west, offer the chance to buy median-priced properties in good areas. On average, he expects these types of suburbs to yield four to five per cent and deliver capital growth of around 10 per cent per decade.

“We advise people to buy at around the median house price – so for Sydney, that’s around $650,000 at the moment. It means that if you sell the property in the future or you lease it, you will be engaging most people. If you buy a property for say over a million dollars, you immediately cut your potential buyer and tenant base.”

Of course not everyone can afford the inner suburbs or wants to invest in these areas, and there are many other parts of Sydney worth considering.

In a recent McGrath Report, John McGrath outlined his suburb picks for 2014 across the broader Sydney area based on opportunities for capital growth. The six areas included:

Camperdown / Newtown / Erskinville – Underpinned by the university community and strong Chinese buyer demand

Kensington / Randwick – Close to the university and set to benefit from the new light rail system

Willoughby / Artarmon – A less expensive option for families wanting to live on the lower north shore

Marrickville / Dulwich Hill / Petersham / Enmore – A trendy area grabbing the attention of young professionals but without the Paddington price tags

Brigthon-Le-Sands / Sans Souci / Dolls Point – Convenient and affordable family living

Castle Hill / Kellyville / Rouse Hill – Large blocks and bigger houses for less money with bustling town centres and a planned rail link.

For a more detailed explanation of John’s suburb picks, check out this article on Switzer.com.au